Medicare Part D

Medicare Part D is a prescription drug plan offered by Medicare approved private insurance companies. Part D helps to pay for both brand name and generic drugs.

You can get Part D two ways:

• Medicare Prescription Drug plans or “PDPs”. PDP’s are stand alone prescription drug plans. The coverage can be added to Original Medicare, Private Fee for Service (PFFS) plans, Medicare Cost Plans and Medicare Medical Savings Account (MSA) Plans.
• You can also get prescription drug coverage thru Medicare Advantage Plans. Medicare Advantage Plans that include prescription drugs are MAPD’s. These plans are HMO, PPO, POS and PFFS plans.

Enrolling in a Part D Plan

To join a Medicare Part D plan, you must have Part A or Part B. To join a Medicare Advantage Plan you must have Part A and Part B. You must also live in the service area of the Medicare Advantage plan or drug plan you want to join.

Coverage

Part D plans cover generic and brand-name drugs. All plans
must cover the same categories of drugs. However, plans can
specifically choose the drugs to cover in each drug category.

Cost

Plans have different monthly premiums. They also have different copay and co-insurance amounts. Some people qualify for Extra Help from Medicare to help pay for their drug plan costs. You can apply for for Extra Help online at Social Security Administration website.

There are 4 Coverage Stages in Medicare Part D’s Coverage

• Annual Deductible – You will pay the negotiated price for your prescription drugs until the deductible is met. Some plans don’t have deductible. Deductibles vary from plan to plan. However, in 2024 the deductible cannot be more than $545. In 2025, the deductible cannot be more than $590.
• Initial Coverage – During the Initial Coverage, you will pay a co-payment or co-insurance and the plan will pay some of the cost. In 2024, the initial coverage period ends after you have accumulated $5,030 in total drug costs. Total drug cost is what you pay plus what the plan pays.
• Coverage Gap(Donut Hole) – After total drug costs reach $5,030, you enter the coverage gap or “donut hole.” In other words, you would be responsible for 25% of the cost of your drugs. In 2025, the coverage gap will be eliminated.
• Catastrophic Coverage – After you have paid $8,000 in out of pocket costs for covered medications, you reach catastrophic stage. During catastrophic coverage, you pay $0 for the rest of the year.

*** In 2025, the maximum out of pocket for Medicare Part D will be $2,000.***

Part D Plan Availability

The average beneficiary has a choice of 21 PDPs in 2024. In 2023, there were 66 million people covered by Medicare, 50.5 million were enrolled in Part D. More than half (56%) were enrolled in MA-PD’s and 44% in PDPs.

2025 Part D Plans

Benefit information for 2025 plans will be available beginning October 1, 2025. The Annual Enrollment Period begins on October 15 and it lasts through December 7.